Air India To Get 787 This Week

National carrier Air India will receive its first 787 long-range aircraft from Boeing this week after a four-year delay in deliveries.

“The first aircraft is expected to arrive in New Delhi by Friday . . . This will be followed by the delivery of two others in September,” an airline official tells AviationWeek.

Air India plans to take delivery of all 27 787 aircraft by 2016, he continues, adding that a delivery schedule will be finalized after the carrier receives its two shipments in the first week of September.

The introduction of its 787 aircraft will enable cash-strapped Air India to increase its international network, including services to Melbourne and Sydney later this year, says the airline spokesman.

Air India ordered 27 787s in 2005 as part of a 68-aircraft deal, and deliveries were scheduled to start May 2008 before the U.S. airframer instituted a series of program delays.

In May 2012, the Indian government threatened to reject the deliveries unless Boeing provided compensation for the four-year delay, but this was followed two months later with a the approval of a compensation package by Air India’s board of directors.

That deal has now been granted final approval by the Cabinet Committee on Economic Affairs, which allows Air India to take delivery of its 787 fleet.

Neither the government nor Air India will divulge details of the compensation package, citing a confidentiality agreement with Boeing.

One government official, however, says the agreement could include a deduction from the total cost of the 27 787s and discounts on future orders.

Air India plans to enter into a sale and lease back agreement for its 787 fleet alongside similar deals for its Boeing 777 and 747, says a civil aviation ministry official.